Fitch Report: Online Gambling is Coming

It’s been recently stated in the Fitch Ratings report that the legalization of online gambling in the United States was getting “increasingly likely” to happen. The Boston Herald cited the issued report, pointing out that, “Multiple states have been considering intrastate online gaming proposals, new federal proposals are being discussed, and the budget outlook at both state and federal levels remains strained. Companies have been ramping up online initiatives and/or entering into alliances, such as Wynn-PokerStars and Caesars-888 Holdings.”

It was estimated, by the Fitch report that online gaming revenues in USA from offshore companies range from $5 billion to $6 billion a year and could “ramp up significantly if regulations are liberalized.” Many analysts claim that it’s comparable with the $60 billion in revenues that American gambling facilities collected last year, including Native American and racetrack business. A gambling industry analyst Michael Paladino stated for the Boston Herald that racetrack slot parlors and the Lottery would probably be the greatest hit if online gambling won federal or regional approval, but added that many questions need to be answered, stating: “The question is, is it just poker? Is it broader than poker? Would it be just affiliated with interstate? Or is it a federal proposal? There’s a lot of influences that could affect that equation. If it is interstate, does it go through the lottery commissions? Those are all questions that we have as well.”

Also, Steve Grossman, who chairs the Massachusetts Lottery Commission, said that internet gambling is “a major competitive threat” to the lottery, which makes a profit of $4.5 billion a year and sends up to $900 million a year to cities and towns as local aid. He said, “There is reason to be concerned about some developments that are taking place nationally. The demographics of lottery players is changing, it is aging. If the Congress decides to go in the direction of Internet gaming, which is a federal issue, why wouldn’t Massachusetts, the most successful lottery in the United States with all kinds of technology here in Massachusetts, why shouldn’t we be able to put together a Massachusetts-based or a regional internet gaming product that would protect our lottery revenues?”

Grossman’s spokesman, John Carlisle, later on confirmed that the lottery is making a long term plan, and that online gambling potential is going to be considered saying, “We also hope that as Congress deliberates the issue, they consider the significant impact that online gambling could have on local aid in Massachusetts and in virtually every other state.”